QUIZ KEYS FOR CHAPTERS 7 AND 8 IN COLANDER AND CHAPTER 3 IN WHEELAN

CHAPTER 7

1. Graph 7.2 on the costs of Taxation. Be able to draw and explain.

2. Graph 7-5 on inelastic demand and the incentive to restrict supply. Be able to draw and explain.

CHAPTER 8

1. What is the principle of rational choice?

2. What is the principle of diminishing marginal utility?

3. What the limitations of the assumptions behind the principle of rational choice?

CHAPTER 3 IN WHEELAN

1. What are the positive roles that the government can play in the economy?

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